Home Depot earnings jump 17%, aided by housing recovery

Shoppers and store employees walk through the aisles at the Home Depot store in Williston, Vt.

Shoppers and store employees walk through the aisles at the Home Depot store in Williston, Vt. (Toby Talbot / Associated Press)

Ricardo Lopez

The housing recovery and improving economy led Home Depot Inc., the nation's largest home improvement retailer, to post better-than-expected second-quarter earnings, which jumped 17% over the same period last year.

The Atlanta-based company reported Tuesday that sales were $22.5 billion, up 9.5% over the same time period last year.

For the quarter ending Aug. 4, Home Depot posted an overall profit of $1.8 billion, or $1.24 per share. That's up from $1.53 billion, or $1.01 a share, during the same period last year.

"The second-quarter results exceeded our expectations as our business benefited from a rebound in our seasonal categories, continued strength in the core of the store and the recovering housing market in the U.S.," said Frank Blake, Home Depot's chief executive.

Consumers, spending again on big-ticket items, spent more money per transaction during the second quarter, the company said. The average purchase amount rose 4.3% to $57.39.

The company also raised its earnings guidance for the rest of the year as a result of the strong second quarter. It now expects earnings per share to rise 20% to $3.60.

The home improvement retailer's sales have been bolstered as housing starts tick up this year. The housing recovery has also spurred demand for durable goods such as refrigerators, stove-tops, washers and dryers.